Net absorption continues to trend positive as new supply is absorbed and vacancy holds firm

The Houston industrial market posted positive net absorption of 4.2 million square feet (msf) in Q4 2024, surpassing new deliveries and driving a 30-basis-point (bps) quarter-over-quarter decrease in vacancy. Demand remains resilient, with significant deals such as U.S. Elogistics leasing approximately 300,000 square feet (sf) and Keen Transport securing 160,720 sf. Numerous leases exceeding 100,000 sf further underscore the continuation of this trend. Construction starts increased from the prior quarter, pushing the pipeline to 14.7 msf, despite 2.3 msf delivered. Despite an uptick in speculative new construction, vacancy will remain flat if net absorption continues to trend near its robust five-year average.

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